Social ties and home bias in mergers and acquisitions

Federico Carril-Caccia (), Aitor Garmendia-Lazcano and Asier Minondo ()
Additional contact information
Federico Carril-Caccia: Deusto Business School, Bilbao-San Sebastián

Review of World Economics (Weltwirtschaftliches Archiv), 2023, vol. 159, issue 3, No 2, 563-593

Abstract: Abstract This paper explores whether social ties, proxied by Facebook friendship links, can explain why the number and value of mergers and acquisitions (M&As) are greater within countries than between countries. We find that social ties are positively correlated with the number and value of M&As. We also demonstrate that the home bias in M&As is greatly reduced once we control for the differences in social ties between and within countries. We further find that social ties particularly facilitate M&As when the level of corruption is high, press freedom is limited in the target country, and there are more cultural differences between the acquirer and target countries.

Keywords: Mergers and acquisitions (M&As); Social ties; Border effect; Facebook; foreign direct investment (FDI); European Union (EU) (search for similar items in EconPapers)
JEL-codes: F15 F21 F23 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10290-022-00475-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:weltar:v:159:y:2023:i:3:d:10.1007_s10290-022-00475-0

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10290/PS2

DOI: 10.1007/s10290-022-00475-0

Access Statistics for this article

Review of World Economics (Weltwirtschaftliches Archiv) is currently edited by Paul Bergin, Holger Görg, Cédric Tille and Gerald Willmann

More articles in Review of World Economics (Weltwirtschaftliches Archiv) from Springer, Institut für Weltwirtschaft (Kiel Institute for the World Economy) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().